Question 1

The creation of a single market through regional economic integration offers significant opportunities because markets that were formerly protected from foreign competition are increasingly open.

Accepted Answer

A) True 
 B)False

Question 2

The stated aim of the Asia-Pacific Economic Cooperation is to increase multilateral cooperation in view of the economic rise of the Pacific nations and the growing interdependence within the region.

Accepted Answer

A) True 
 B)False

Question 3

Trade creation occurs when lower-cost external suppliers are replaced by higher-cost suppliers within the free trade area.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following occurs when high-cost domestic producers are replaced by low-cost producers within a free trade area?

Accepted Answer

A)  Value creation
B)  Strategic pricing
C)  Trade creation
D)  Trade diversion
E)  Economic exposureF) B) and E)
G) A) and C)

Question 5

The European Community became the European Union in 1993 following the ratification of the:

Accepted Answer

A)  Maastricht Treaty.
B)  Warsaw Pact.
C)  Treaty of Rome.
D)  Single European Act.
E)  Lisbon Treaty.F) A) and B)
G) A) and C)

Question 6

Which of the following is responsible for proposing European Union legislation, implementing it, and monitoring compliance with European Union laws by member-states?

Accepted Answer

A)  Council of the European Union
B)  European Commission
C)  European Parliament
D)  Court of Justice
E)  European CommunityF) A) and B)
G) A) and C)

Question 7

Which of the following is the aim of the Central America Free Trade Agreement?

Accepted Answer

A)  Lowering of trade barriers between the United States and the Central American Common Market countries
B)  Elimination of trade barriers between the CARICOM and Central American Common Market countries
C)  Reduction of trade barriers between Caribbean Single Market and Economy nations and Central American Common Market countries
D)  Introduction of a common currency for Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua
E)  Reductions in tariffs and quotas between Costa Rica, Dominican Republic, and NicaraguaF) A) and E)
G) All of the above

Question 8

Which of the following is true about the European Commission?

Accepted Answer

A)  The European Union's competition commissioner has been gaining influence as the chief regulator of competition policy in the member nations of the European Union.
B)  The European Commission has to be approved by the Council of the European Union before it can begin work.
C)  The European Commission does not have a policing role with respect to European Union laws.
D)  The legislation proposed by the European Commission goes directly to the European Parliament.
E)  The European Commission is the ultimate controlling authority within the European Union.F) A) and D)
G) B) and E)

Question 9

Which of the following treaties committed European Community members to adopt a common currency by January 1, 1999?

Accepted Answer

A)  The Maastricht Treaty
B)  The Treaty of Rome
C)  The Treaty of Lisbon
D)  The Montreal Treaty
E)  The Treaty of ParisF) None of the above
G) A) and C)

Question 10

Which of the following refers to a pact that originated in 1988 to establish a free trade area now including Argentina, Brazil, Paraguay, and Uruguay?

Accepted Answer

A)  ASEAN
B)  NAFTA
C)  Mercosur
D)  CARICOM
E)  CAFTAF) A) and E)
G) C) and D)

Question 11

The Andean Pact was largely based on the European Union model and was highly successful at achieving its stated goals.

Accepted Answer

A) True 
 B)False

Question 12

The Andean Community now operates as a(n) :

Accepted Answer

A)  common market.
B)  economic union.
C)  customs union.
D)  command economy.
E)  political union.F) A) and E)
G) D) and E)

Question 13

By adopting the euro, the European Union has created the second most widely traded currency in the world after that of the U.S. dollar.

Accepted Answer

A) True 
 B)False

Question 14

A key advantage of adopting the euro is that it:

Accepted Answer

A)  helps in reduction of competition in Europe.
B)  has prevented the development of a highly liquid pan-European capital market.
C)  lowers foreign exchange and hedging costs in Europe.
D)  insulates Europe from international competition.
E)  increases the range of investment options open to institutions only.F) None of the above
G) A) and E)

Question 15

The Maastricht Treaty called for:

Accepted Answer

A)  establishment of the independent European Central Bank (EC
B)  .
B)  the abolition of restrictions on cabotage.
C)  establishment of the European Parliament.
D)  the formation of a single market for the European Union.
E)  placing restrictions on foreign exchange transactions between member countries.F) A) and B)
G) A) and C)

Question 16

Which of the following are the two impediments to regional economic integration?

Accepted Answer

A)  Labor activism and political ideologies
B)  Immigration and political ideologies
C)  Costs and national sovereignty
D)  Political will and popular support
E)  Political ideologies and international policiesF) A) and B)
G) A) and C)

Question 17

Differentiate between a free trade area and a customs union. Provide an example of each form of economic integration.

Accepted Answer

In a free trade area, all barriers to th...

Question 18

Suppose the country of Ceria and Lithinia imposed tariffs on imports from all countries, and then they set up a free trade area, scrapping all trade barriers between themselves but maintaining tariffs on imports from the rest of the world. Now, Ceria begins to import sugar from Lithinia. However, Ceria had previously been importing sugar from another country, Cadnia, which produced sugar more cheaply than Ceria or Lithinia. This is known as:

Accepted Answer

A)  trade creation
B)  strategic pricing
C)  synergy
D)  trade diversion
E)  protectionismF) A) and E)
G) B) and D)

Question 19

Which of the following is defined as a group of countries committed to removing all barriers to the free flow of goods and services between each other, but pursuing independent external trade policies?

Accepted Answer

A)  Free trade area
B)  Command economy
C)  Efficient market
D)  Foreign exchange market
E)  Location economyF) A) and E)
G) C) and D)

Question 20

Where has the movement toward regional economic integration been most successful?

Accepted Answer

A)  Africa
B)  South America
C)  North America
D)  Europe
E)  AsiaF) D) and E)
G) C) and E)

Exam 9: Regional Economic Integration

Correct Answer
verified

Which of the following is responsible for proposing European Union legislation, implementing it, and monitoring compliance with European Union laws by member-states?

Correct Answer
verified

Which of the following is the aim of the Central America Free Trade Agreement?

Correct Answer
verified

The Maastricht Treaty called for:

Correct Answer
verified

The Andean Community now operates as a(n) :

Correct Answer
verified

Which of the following is true about the European Commission?

Correct Answer
verified

The creation of a single market through regional economic integration offers significant opportunities because markets that were formerly protected from foreign competition are increasingly open.

Correct Answer
verified

Which of the following refers to a pact that originated in 1988 to establish a free trade area now including Argentina, Brazil, Paraguay, and Uruguay?

Correct Answer
verified

The European Community became the European Union in 1993 following the ratification of the:

Correct Answer
verified

The Andean Pact was largely based on the European Union model and was highly successful at achieving its stated goals.

Correct Answer
verified

By adopting the euro, the European Union has created the second most widely traded currency in the world after that of the U.S. dollar.

Correct Answer
verified

Which of the following occurs when high-cost domestic producers are replaced by low-cost producers within a free trade area?

Correct Answer
verified

A key advantage of adopting the euro is that it:

Correct Answer
verified

Differentiate between a free trade area and a customs union. Provide an example of each form of economic integration.

Correct Answer
verified
In a free trade area, all barriers to th...
View Answer

Trade creation occurs when lower-cost external suppliers are replaced by higher-cost suppliers within the free trade area.

Correct Answer
verified

Which of the following treaties committed European Community members to adopt a common currency by January 1, 1999?

Correct Answer
verified

Where has the movement toward regional economic integration been most successful?

Correct Answer
verified

Which of the following are the two impediments to regional economic integration?

Correct Answer
verified

The stated aim of the Asia-Pacific Economic Cooperation is to increase multilateral cooperation in view of the economic rise of the Pacific nations and the growing interdependence within the region.

Correct Answer
verified

Which of the following is defined as a group of countries committed to removing all barriers to the free flow of goods and services between each other, but pursuing independent external trade policies?

Correct Answer
verified

Exam 9: Regional Economic Integration

Correct AnswerverifiedShow Answer

Which of the following is responsible for proposing European Union legislation, implementing it, and monitoring compliance with European Union laws by member-states?

Correct AnswerverifiedShow Answer

Which of the following is the aim of the Central America Free Trade Agreement?

Correct AnswerverifiedShow Answer

The Maastricht Treaty called for:

Correct AnswerverifiedShow Answer

The Andean Community now operates as a(n) :

Correct AnswerverifiedShow Answer

Which of the following is true about the European Commission?

Correct AnswerverifiedShow Answer

The creation of a single market through regional economic integration offers significant opportunities because markets that were formerly protected from foreign competition are increasingly open.

Correct AnswerverifiedShow Answer

Which of the following refers to a pact that originated in 1988 to establish a free trade area now including Argentina, Brazil, Paraguay, and Uruguay?

Correct AnswerverifiedShow Answer

The European Community became the European Union in 1993 following the ratification of the:

Correct AnswerverifiedShow Answer

The Andean Pact was largely based on the European Union model and was highly successful at achieving its stated goals.

Correct AnswerverifiedShow Answer

By adopting the euro, the European Union has created the second most widely traded currency in the world after that of the U.S. dollar.

Correct AnswerverifiedShow Answer

Which of the following occurs when high-cost domestic producers are replaced by low-cost producers within a free trade area?

Correct AnswerverifiedShow Answer

A key advantage of adopting the euro is that it:

Correct AnswerverifiedShow Answer

Differentiate between a free trade area and a customs union. Provide an example of each form of economic integration.

Correct AnswerverifiedIn a free trade area, all barriers to th...View AnswerShow Answer

Trade creation occurs when lower-cost external suppliers are replaced by higher-cost suppliers within the free trade area.

Correct AnswerverifiedShow Answer

Which of the following treaties committed European Community members to adopt a common currency by January 1, 1999?

Correct AnswerverifiedShow Answer

Where has the movement toward regional economic integration been most successful?

Correct AnswerverifiedShow Answer

Which of the following are the two impediments to regional economic integration?

Correct AnswerverifiedShow Answer

The stated aim of the Asia-Pacific Economic Cooperation is to increase multilateral cooperation in view of the economic rise of the Pacific nations and the growing interdependence within the region.

Correct AnswerverifiedShow Answer

Which of the following is defined as a group of countries committed to removing all barriers to the free flow of goods and services between each other, but pursuing independent external trade policies?

Correct AnswerverifiedShow Answer

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In a free trade area, all barriers to th...
View Answer

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Correct Answer
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